We've reached a tipping point where technology is now destroying more jobs than it creates, researcher warns

Thanks to the efficiency of the internet and automated
systems, productivity and GDP have grown during the last few
decades, but the middle class and jobs are
disappearing.

In fact, we have reached a tipping point where technology
is now destroying more jobs than it creates. And if the trend
continues we could face a serious crisis in the US and
abroad, said Wendell Wallach, a consultant, ethicist,
and scholar at the Yale University Interdisciplinary Center for
Bioethics.

Technological unemployment is the concept of technology
killing more jobs than it produces. While that fear has been
considered a Luddite fallacy for the past 200 years, it is now
becoming a stark reality, he said.

“This is an unparalleled situation and one that I think
could actually lead to all sorts of disruptions once the public
starts to catch on that we are truly in the midst of
technological unemployment," Wallach said during a
presentation at the Carnegie Council for Ethics and International
Affairs on Tuesday.

And yet there are no signs of the trend reversing. Because
technology is evolving faster than ever before with little to no
oversight or regulation, the likelihood of more jobs being
replaced by new tech is at an all-time high, Wallach told
Business Insider.

In fact, some 47% of present jobs in the US could be computerized
in the next 10 to 20 years, according to an Oxford University study published in 2013.

Traditionally, elements like productivity, jobs, hourly
wages, and income all grew in unison. However, during the last 30
years GDP and productivity grew while the US median income
stopped and employment flattened, Wallach writes in his new book.
Technology innovation has played a significant role in this
trend.

“For most of our history 50% of GDP went to wages and 50%
went to capital, and we are seeing a radical alteration in that
largely because of the anomaliesof money being made
in high tech industries,” he said. “That’s not anybody doing anything wrong,
that’s just technology industries are different from old
manufacturers."

So, for example, in 1990 GM, Ford, and Chrysler brought in
$36 billion in revenue and hired over a million workers, Wallach
said. The big three today — Apple, Facebook, and Google — bring in over
a trillion dollars in revenue and only have about 137,000
workers, he said.

This change has created a situation where more and more of
the capital is going to a smaller percentage of the population.
In fact, we are on course for 70% of stock ownership to be held
by 5% of the population, Wallach said.

This is a dangerous scenario because it could potentially
lead to massive social unrest, possibly even
revolutions.

"When people no longer receive the money from wages they
need to support their families, it is hard to know what they will
do, but in the past and in other countries this has been thought
of as a situation ripe for a revolution," Wallach said.

However, he added, that such a crisis could be averted if
government take action to fix wealth distribution.

"That kind of dire response can of course be avoided
through welfare reforms or job subsidies, but these would require
redistributing some of the capital growth achieved through from
increased productivity," he said.